TxDOT terminates IBM toll operations contract due to system issues

The Texas Department of Transportation (TxDOT) has terminated its toll operations contract with IBM, citing "continued challenges" with its upgraded toll operations system.

TxDOT says that since the rollout of the new system, TxTag customers and toll road users have experienced "unnecessary challenges" in managing their accounts.

"We take the responsibility of providing a quality and trusted customer experience very seriously, and regret the impact and inconvenience these past many months of lackluster IBM service have had on our toll road users," said TxDOT Executive Director Marc Williams. "We will continue to keep customers apprised on our progress to improve our customers’ interactions with TxTag. Our customers deserve better and we are committed to ensuring that they receive that going forward."

IBM responded to TxDOT's decision with a statement, saying:

"IBM disagrees with TxDOT's decision to terminate our contract and disputes the State's alleged grounds for doing so. The success of any information technology project depends on each of the participants fulfilling its obligations. IBM's performance on this project has been hampered by the inability of TxDOT to do so. Despite TxDOT's failure, IBM's performance and the system IBM has implemented far exceed operational requirements anticipated when the contract was signed, to the benefit of Texas motorists."

TxDOT has secured new interim technology providers via an emergency contract with SAP and the Department of Information Resources Managed Security Services to help stabilize and improve the back-end system to manage the massive amount of customer data and toll transactions, says the agency. 

TxDOT says it also has begun the process of procuring a new service provider that will assume responsibilities from the interim team to continue rigorous improvements and operations.

TxDOT says that customers do not need to take any action at this time and are encouraged to continue managing their accounts at www.TxTag.org or by contacting the call center at 888-468-9824. As has been the case since the upgraded system transition first began in late 2020, no late fees are being assessed at this time.

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